Craigs.....was talking to their financial adviser last week and discussed how many would need to be applied for to avoid dilution. Money moved by Craigs today from my wifes cash account indicate allocation will be 42.3% of what was applied for.
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5 day VWAP was ~$1.81, so less the 2.5% discount, SPP shares should be allotted at ~$1.766. Difference to spot equiv. to about an interim divy. Be interesting if the $70m is kept or oversubscriptions ensue - EBOS took some. The more oversubscriptions the lower the theoretical ex price once all settled up.
Also, below the transcript from HGH's conference call on the 22nd August. Always makes for interesting reading.
https://finance.yahoo.com/news/edite...223000350.html
From that conference call ……a lesson how to do ‘proactive provisioning’
Question: First of all, the $8 million economic overlay, how did you calculate that, the science behind that?
Drumm: Thanks,. So what we did to calculate that as we look to the impact downside scenario on the portfolios that Jeff mentioned, being a business relationship and asset finance in particular. So what would a downflow scenario look like to those portfolios. And during the bottom up now sort of losses computed with model losses yielded a number and that informed the size of the overlay.
Question follow up - I guess how aggressive did you get in terms of I guess, economic conditions, I mean, what was sort of the assumptions behind it?
Drumm - I think -- look, there are a number of assumptions behind that. The problem, it's difficult to model losses, right? So -- what we did is looked at what we thought the impact could be on us by reference to our book and our individual exposures rather than using a sort of a more sophisticated model approach.
So lots of words showing how clever you can be in saying a ‘calculated guess’ ……..but a cynic / realist would say it’s really what was required to bring full year normalised npat to $96.1m …now that’s being proactive.
ECL provisions a bit of a rabbit hole if you dive into them. It's not complete willy nilly stuff, there are specific accounting rules governing it all, applied regressed econometric models built to industry standard, but of course subjectivity. KPMG would have no doubt been through it in detail as it will be a key audit matter. They will have benchmarks and no doubt mindful of comparable provisions adopted by other banks, both live, and at other points in the cycle. It's not something you can just waive a wand at to get to your desired outcome, as that would be fraud.